No booze blues – the rise of non-alcoholic beverages

This week in the UK, Sainsbury’s is launching a pop-up pub, The Clean Vic, which is only serving low-ABV (alcohol by volume) alternatives to wines, beers and spirits.

It’s actually not the first venue of its type in the UK, but it’s the latest expression of the rise of low- and no-alcohol drinks and culture – “sober bars”, as the Americans call them, and “drink-optional” venues – as part of a broader cultural swing to moderated drinking.

According to Mark Livings, CEO of non-alcoholic-spirits brand Lyre’s, the rise of these kinds of pubs shows a broader consumer trend towards mindful drinking. 

“These venues are doing a very important job of raising awareness that there are now sophisticated, adult, non-alcoholic drinks available on the market, and those choosing not to drink, either temporarily or permanently, no longer need to feel socially ostracised,” he says.

“The UK is a far more developed market for non-alcoholic options. Almost every bar or restaurant in London has some form of non-alcoholic beverage available, beyond simple serves like lemon, lime and bitters. We are, however, seeing forward-thinking Australian hospitality operators really start to refine their options for no- and low-alcohol drinks options, and we’re happy we can be part of this change.”

Abstinence is trendy

Sainsbury’s Clean Vic will serve beverages with less than 0.5 per cent ABV and will feature the UK’s first non-alcoholic dark distillate, Celtic Soul, along with over 20 types of drinks, including beers such as Lucky Saint, aperitifs such as Everleaf, and a collection of wines. In the off-premise, Sainsbury’s has seen a 32 per cent increase in sales of no- and low-alcoholic products in the past quarter, and a 33 per cent increase in customers searching for non-alcoholic products online.

Elsewhere in London, alcohol-free Redemption Bar now has three locations, and in January, The Virgin Mary alcohol-free pub opened in Dublin.

Online, DryDrinker claims to have the UK’s largest range of low- and no-alcohol beers, wines and spirits. 

The numbers differ by source, but all point to the same trend. A Kantar 2018 report suggests that UK alcohol consumption is at the lowest level on record, with one in five adults teetotal.

According to a recent International Wine and Spirits Record report, Global Opportunities in Low & No Alcohol, 65 per cent of 25 to 34 year olds (the UK’s heaviest drinkers) are trying to or have tried to cut back their alcohol intake. The same report states that low- and no-alcohol brands represent 1.3 per cent of the UK’s alcohol market – but that’s expected to grow more than 80 per cent between 2018 and 2022, with spirits leading the growth followed by RTDs, cider, wine and then beer. A 2018 Nielsen report states that spend on low- and no-alcohol beers alone increased 28 per cent, with Heineken 0.0 and Budweiser Prohibition Brew significant contributors.

Millennial mocktails

In the US, low- and no-alcohol brands are only 0.5 per cent of the total alcohol market, according to IWSR, but 52 per cent of adults have or are reducing their alcohol intake. But according to The Wall Street Journal, while overall beer sales stagnate, no-alcohol beer sales have grown 3.9 per cent on average for the past five years and are the fastest growing segment in the beer category. AB Inbev’s Budweiser Prohibition Brew, with no alcohol, is currently being tested in some US markets.

The on-premise is seeing the rise of no-alcohol bars such as Getaway in New York’s Brooklyn, where the menu features a list of US$13 cocktails with exotic ingredients like tobacco syrup, lingonberry and jalapeño puree. High-end restaurants are beginning to include non-alcoholic pairings in their tasting menus. High-end bar Existing Conditions in New York estimates that 20 to 30 per cent of the total drinks they sell are non-alcoholic.

In the land of sin

The IWSR report notes that Spain is one of Europe’s largest and most well established markets for low- and no-alcohol beverages, led by beer and mixed drinks. Alcohol-free beer on tap is available in most Spanish bars. Alcohol-free beers in Spain are called sin-alcohol and many varieties come with lemon or other citrus fruit flavourings.

In a country with a very strong aperitif lunch culture, led by vermouth, there’s now Vermut Sin. And for the sobremesa (after-dinner chat) intrinsic to Spanish dining, there are now sin versions of the chupito, a shot-glass sized digestif, that comes in an array of flavours. In fact, many venues are now making their own versions.

Dry July and Ocsober

In Australia, while non-alcoholic beer represents the largest share of the low- and no-alcohol market, it is actually expected to decline by 0.1 per cent to 2022, where low- and no-alcohol distillates (spirits) are predicted to grow 28.6 per cent. The launch of Lyre’s range of non-alcoholic spirits in April is indicative of this.

Beer isn’t giving up, though. AB InBev recently announced it wants to increase the percentage of its sales coming from low- and no-alcohol beer to 20 per cent by 2025. 

Adult non-alcoholic soft drinks are also on the rise, as are alcohol-free online retail specialists such as Alcofree.

According to IRI’s Moderation & Abstention report, the liquor abstention rate is currently 20 to 23 per cent of the adult population and rising long term, as is temporary abstention for events such as Dry July, Ocsober and the traditional January post-Christmas-blowout temperance period.

Australians’ interest in leading a healthier lifestyle can also be seen in the rise of veganism and vegetarianism and, according to Livings, the increase in no- and low-alcohol options is a reflection of that.

Our multicultural population, which includes Asian and Middle Eastern ethnicities which often practice abstinence or embrace a moderate drinking culture, has partially been behind the rise of low- and no-alcohol, as well as millennials who are more wellness-focused than preceding generations. A La Trobe University study of 120,000 Australians found one-third said they had reduced frequency and quantity of alcohol consumption in the past year, with those aged 24 to 29 the most likely to have reduced intake. The Australian Bureau of Statistics has found that Australian annual alcohol consumption levels are at their lowest since the early 1960s.

On the other hand, Australians are still among the heaviest drinkers in the world, at 10 litres of pure alcohol per person annually, more than the Americans or the Japanese. So the traditional Aussie pub isn’t going anywhere soon. But it may offer a better range of mocktails.

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